BILL NUMBER: AB 2777	CHAPTERED  09/30/00

	CHAPTER   980
	FILED WITH SECRETARY OF STATE   SEPTEMBER 30, 2000
	APPROVED BY GOVERNOR   SEPTEMBER 29, 2000
	PASSED THE ASSEMBLY   AUGUST 31, 2000
	PASSED THE SENATE   AUGUST 29, 2000
	AMENDED IN SENATE   AUGUST 25, 2000
	AMENDED IN SENATE   AUGUST 7, 2000
	AMENDED IN SENATE   JUNE 15, 2000
	AMENDED IN ASSEMBLY   MAY 3, 2000
	AMENDED IN ASSEMBLY   MAY 1, 2000

INTRODUCED BY   Assembly Member Granlund

                        FEBRUARY 25, 2000

   An act to amend Sections 25502.1 and 25503.6 of, and to add
Section 25500.2 to, the Business and Professions Code, relating to
alcoholic beverages.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 2777, Granlund.  Alcoholic beverages:  licensees:  advertising:
  tied-house restrictions.
   The Alcoholic Beverage Control Act contains limitations on sales
commonly known as "tied-house" restrictions, which generally prohibit
a manufacturer, winegrower, manufacturer's agent, California
winegrower's agent, rectifier, distiller, bottler, importer, or
wholesaler from furnishing, giving, or lending any money or other
thing of value to any person engaged in operating, owning, or
maintaining any on-sale or off-sale licensed premises.
   Existing law provides that for purposes of the off-sale
provisions, the listing of the names, addresses, telephone numbers or
E-mail addresses, or both, or website addresses, of 2 or more
unaffiliated off-sale retailers selling the products produced,
distributed or imported by a nonretail industry member, defined as a
manufacturer, winegrower, or distiller of alcoholic beverages, in
response to a direct inquiry from a consumer received by telephone,
by mail, by electronic Internet inquiry or in person does not
constitute a thing of value or prohibited inducement to the listed
off-sale retailer, if specified conditions are met.
   This bill would extend these provisions to on-sale licensees, and
would include within the definition of a nonretail industry member an
agent of a manufacturer, winegrower, or distiller of alcoholic
beverages, and a wholesaler of distilled spirits or wine.
   Existing law generally prohibits a manufacturer of alcoholic
beverages and a winegrower from paying, crediting, or compensating a
retailer for advertising or paying or giving anything of value for
the privilege of placing a sign or advertisement with a retail
licensee.  It authorizes, as an exception, the holder of a beer
manufacturer's or winegrower's license to purchase advertising space
and time from, or on behalf of, an on-sale retail licensee, subject
to specified conditions.
   This bill would also permit a distilled spirits manufacturer or a
distilled spirits manufacturer's agent to purchase the advertising
space and time from, or on behalf of, an on-sale retail licensee
subject to the existing conditions.  The bill would permit specified
manufacturers to purchase advertising space and time from a retail
licensee who is the owner, manager, agent, assignee, or major tenant
of a certain sized arena in Los Angeles County.
   Existing law makes it a misdemeanor for a licensee, subject to the
provisions of the bill, to violate existing provisions relating to
the purchase of that advertising space or time.
   This bill would impose a state-mandated local program by expanding
the licensees subject to these criminal provisions.
  The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state.  Statutory provisions establish procedures for making that
reimbursement.
   This bill would provide that no reimbursement is required by this
act for a specified reason.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 25500.2 is added to the Business and
Professions Code, to read:
   25500.2.  (a) Notwithstanding Section 25500, the listing of the
names, addresses, telephone numbers, E-mail addresses, or website
addresses, of two or more unaffiliated on-sale retailers selling
beer, wine, or distilled spirits, and operating and licensed as bona
fide public eating places pursuant to Section 23038 selling the beer,
wine, or distilled spirits produced, distributed, or imported by a
nonretail industry member in response to a direct inquiry from a
consumer received by telephone, by mail, by electronic Internet
inquiry, or in person does not constitute a thing of value or
prohibited inducement to the listed on-sale retailer, provided all of
the following conditions are met:
   (1) The listing does not also contain the retail price of the
product.
   (2) The listing is the only reference to the on-sale retailers in
the direct communication.
   (3) The listing does not refer only to one on-sale retailer or
only to on-sale retail establishments controlled directly or
indirectly by the same on-sale retailer.
   (4) The listing is made by, or produced by, or paid for,
exclusively by the nonretail industry member making the response.
   (b) For the purposes of this section, "nonretail industry member"
is defined as a manufacturer, including, but not limited to, a beer
manufacturer, winegrower, or distiller of alcoholic beverages or an
agent of that entity, or a wholesaler of distilled spirits or wine,
regardless of any other licenses held directly or indirectly by that
person.  Except as specifically provided above, any payment for,
making or production, either directly or indirectly, listing the
names, addresses, telephone numbers, E-mail addresses, or website
addresses, of on-sale retailers selling beer otherwise authorized by
this section by a wholesaler of beer or by a wholesaler of beer that
also holds an importer's license shall constitute the furnishing of a
thing of value or inducement to the listed on-sale retailers in
violation of this division.
  SEC. 2.  Section 25502.1 of the Business and Professions Code is
amended to read:
   25502.1.  (a) Notwithstanding Section 25502, the listing of the
names, addresses, telephone numbers, E-mail addresses, or  website
addresses, of two or more unaffiliated off-sale retailers selling the
products produced, distributed or imported by a nonretail industry
member in response to a direct inquiry from a consumer received by
telephone, by mail, by electronic Internet inquiry or in person does
not constitute a thing of value or prohibited inducement to the
listed off-sale retailer, provided all of the following conditions
are met:
   (1) The listing does not also contain the retail price of the
product.
   (2) The listing is the only reference to the off-sale retailers in
the direct communication.
   (3) The listing does not refer only to one off-sale retailer or
only to off-sale retail establishments controlled directly or
indirectly by the same off-sale retailer.
   (4) The listing is made by, or produced by, or paid for,
exclusively by the nonretail industry member making the response.
   (b) For the purposes of this section, "nonretail industry member"
is defined as a manufacturer, including, but not limited to, a beer
manufacturer, winegrower, or distiller of alcoholic beverages or an
agent of that entity, or a wholesaler of distilled spirits or wine,
regardless of any other licenses held directly or indirectly by that
person.  Except as specifically provided above, any payment for,
making or production, either directly or indirectly, listing the
names, addresses, telephone numbers, E-mail addresses, or website
addresses, of off-sale retailers selling beer otherwise authorized by
this section by a wholesaler of beer or by a wholesaler of beer that
also holds an importer's license shall constitute the furnishing of
a thing of value or inducement to the listed off-sale retailers in
violation of this division.
  SEC. 3.  Section 25503.6 of the Business and Professions Code is
amended to read:
   25503.6.  (a) Notwithstanding any other provision of this chapter,
the holder of a beer manufacturer's or winegrower's license or a
distilled spirits manufacturer or distilled spirits manufacturer's
agent may purchase advertising space and time from, or on behalf of,
an on-sale retail licensee subject to all of the following
conditions:
   (1) The on-sale licensee is the owner, manager, agent of the
owner, assignee of the owner's advertising rights, or the major
tenant of the owner of any of the following:
   (A) An outdoor stadium or a fully enclosed arena with a fixed
seating capacity in excess of 10,000 seats located in Sacramento
County.
   (B) A fully enclosed arena with a fixed seating capacity in excess
of 18,000 seats located in Orange County or Los Angeles County.
   (C) An outdoor stadium or fully enclosed arena with a fixed
seating capacity in excess of 8,500 seats located in Kern County.
   (D) An exposition park of not less than 50 acres that includes an
outdoor stadium with a fixed seating capacity in excess of 8,000
seats and a fully enclosed arena with an attendance capacity in
excess of 4,500 people, located within a county of the fourth class,
as defined in Section 28025 of the Government Code.
   (E) An outdoor stadium with a fixed seating capacity in excess of
10,000 seats located in Yolo County.
   (2) The outdoor stadium or fully enclosed arena described in
paragraph (1) is not owned by a community college district.
   (3) The advertising space or time is purchased only in connection
with the events to be held on the premises of the stadium or arena
owned by the on-sale licensee.
   (4) The on-sale licensee serves other brands of beer in addition
to the brand manufactured by the beer manufacturer, other brands of
wine in addition to the brand produced by the winegrower, and other
brands of distilled spirits in addition to the brand manufactured by
the distilled spirits manufacturer or distilled spirits manufacturer'
s agent.
   (b) Any purchase of advertising space or time pursuant to
subdivision (a) shall be conducted pursuant to a written contract
entered into by the holder of the beer manufacturer's or winegrower's
license, the distilled spirits manufacturer, or the distilled
spirits manufacturer's agent and the on-sale licensee.
   (c) Any holder of a beer manufacturer's or winegrower's license,
any distilled spirits manufacturer, or any distilled spirits
manufacturer's agent who, through coercion or other illegal means,
induces a holder of a beer, wine, or distilled spirits wholesaler's
license to fulfill those contractual obligations entered into
pursuant to subdivision (a) or (b) shall be guilty of a misdemeanor
and shall be punished by imprisonment in the county jail not
exceeding six months, or by a fine in an amount equal to the entire
value of the advertising space or time involved in the contract, plus
ten thousand dollars ($10,000), or by both imprisonment and fine.
The person shall also be subject to license revocation pursuant to
Section 24200.
   (d) Any on-sale retail licensee, as described in subdivision (a),
who solicits or coerces a holder of a beer, wine, or distilled
spirits wholesaler's license to solicit a holder of a beer
manufacturer's or winegrower's license, a distilled spirits
manufacturer, or a distilled spirits manufacturer's agent to purchase
advertising space or time pursuant to subdivision (a) or (b) shall
be guilty of a misdemeanor and shall be punished by imprisonment in
the county jail not exceeding six months, or by a fine in an amount
equal to the entire value of the advertising space or time involved
in the contract, plus ten thousand dollars ($10,000), or by both
imprisonment and fine.  The person shall also be subject to license
revocation pursuant to Section 24200.
  SEC. 4.  No reimbursement is required by this act pursuant to
Section 6 of Article XIIIB of the California Constitution because the
only costs that may be incurred by a local agency or school district
will be incurred because this act creates a new crime or infraction,
eliminates a crime or infraction, or changes the penalty for a crime
or infraction, within the meaning of Section 17556 of the Government
Code, or changes the definition of a crime within the meaning of
Section 6 of Article XIIIB of the California Constitution.
